TORONTO (Reuters) - Canadian insurer Sun Life Financial reported a much weaker-than-expected fourth-quarter profit on Wednesday, hurt by disappointing earnings from its U.S. group life and disability operations, but said it was on track to exceed its 2015 earnings target.
Net income declined to C$502 million ($398 million), or 81 Canadian cents a share, in the quarter ended Dec. 31.
But underlying net income was 59 Canadian cents a share, far below analysts expectations of 78 Canadian cents.
“It is a pretty meaningful miss, even if negative experience of this magnitude is not indicative of a run rate,” CIBC World Markets analyst Robert Sedran said in a note to clients.
“The absence of a dividend increase suggests that the better financial position was trumped by a weak underlying result,” he said.
Chief Executive Dean Connor said in a statement the fourth quarter was challenging but that Sun Life was “on track to exceed our 2015 earnings objective.”
The insurer said assets under management rose 15 percent from a year earlier to end 2014 to a record C$734.4 billion.
Reporting by Jeffrey Hodgson; Editing by Grant McCool, Chris Reese and Edwina Gibbs